For every employee, there is good news. In order to increase worker social security, the Central Government launched the Employees Deposit Linked Insurance Scheme in 1976. The Employees’ Provident Fund Organisation (EPFO) oversees this program, which aims to provide life insurance benefits to private sector workers who are members of the EPFO.
EDLI SCHEME
This program is offered to EPFO members at no cost and by the guidelines established for them. The Employees Provident Fund and Miscellaneous Provisions Act of 1952 applies to all organizations that are registered under it. Workers who receive a base pay of up to Rs 15,000 are automatically covered by this program.
Employers must pay 0.5 percent of their employees’ monthly salaries to the EDLI program, with a maximum salary cap of Rs 15,000, as a crucial point to note. The best part is that employees are not required to contribute to the EDLI.
This program is implemented at no cost to EPFO members by the guidelines established for them. All organizations covered by the Employees Provident Fund and Miscellaneous Provisions Act of 1952 are included. This program automatically enrolls workers who make up to Rs 15,000 in basic pay.
If the employee dies while still working, the nominee will get a lump sum insurance benefit. With a ceiling of Rs 50,000, this sum is calculated by multiplying the employee’s average monthly income for the previous 12 months by 30.
Depending on the monthly income cap, the guaranteed benefit can range from Rs 2.5 lakh to Rs 7 lakh. This program is essential for giving the families of deceased employees cash and social security. Additionally, 0.5 percent of the employee’s pay is contributed to this fund by the employer.
The employer may decide to offer a group life insurance plan that provides coverage that is on par with or better than the EDLI scheme if a better insurance choice is available. One benefit of this plan is that, in the event of the employee’s death, the insurance payout will be made to the nominee or successor.
The nominee must send the claim form to the EPFO together with the required paperwork in order to start the claim. The nominee’s bank account will receive a straight credit of the claim amount. The nominee must get Form 5 IF for this from the EPFO website or the office that is closest to them.